There are two characteristics that I think differentiate gambling from investing. Become a Complete Fool
First of all, I think gambling occurs in zero sum games, meaning there is one fixed size pie, and if you win, someone else has to lose. Gamblers on average always lose money, because the house takes a cut, and you have to fight with the other gamblers over what is left over.
Investing is not a zero sum game. The pie is growing all the time because the US and world economies are growing, so that on average over time, everyone who is invested wins. Just stay invested for 20 years, and you are just about certain to win.
The other difference is that I think of gambling as pursuits in which the main differentiator is luck. The vast majority of gambling games are based on luck. Even in games where there is an ability to use skill, the casinos put in rules to minimize the skill allowed, like not allowing counting in blackjack.
In investing, there is clearly a strong element of skill in evaluating the strength of companies, and there are any number of strategies that work over time (value investing, growth investing, etc) to improve your success rate.
I am not a gambler, meaning I don't enjoy playing games of chance in casinos - I'm not afraid to lose money, I just don't "get" the thrill. I do enjoy games of skill - I love chess and Go.
Just like other games of skill, I enjoy pitting my analysis and those of my friends against the market. I also like knowing that I am not giving away my money to play this game - the market is almost always the best place in the world, in the long run, for me to keep my money. So the US economy and world economy are paying me to play - a much nicer position than in a casino.
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There are two characteristics that I think differentiate gambling from investing.
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